June 6 (Bloomberg) -- Las Vegas Sands Corp., the company
controlled by billionaire Sheldon Adelson that is the largest
U.S.-based casino operator, said it has no interest in expanding
into New York under Governor Andrew Cuomo’s terms.

Cuomo, a 55-year-old Democrat, asked lawmakers yesterday to
license three resorts with gambling in the northern part of the
state to enhance tourism and economic development.

No casinos would be allowed within New York City. The
gambling centers would be permitted in the southern part of the
state, including Long Island, five years after the first upstate
property opened. Six potential northern locations were
identified including the Saratoga-Capital District and the
Hudson Valley-Catskills area.

“I don’t think there’s any real understanding of the
casino business,” Sands President and Chief Operating Officer
Michael Leven said yesterday at the company’s annual meeting in
New York when an investor asked about expanding into New York.
“It’s 20 years past the time where the Catskills would have
been the place to put an integrated resort.”

The upstate markets wouldn’t have enough customers to make
casinos very profitable, Leven said.

Adelson, the company’s chairman and chief executive
officer, said doing as Cuomo proposes could cost billions of
dollars, involving convention center space and shopping. Sands
couldn’t meet its goal of a 20 percent return on investment, he
said.

Only NYC

“Sands does not have a major presence outside of Las Vegas,
so it’s not surprising they would only want to go to New York
City,” Rich Azzopardi, a Cuomo spokesman, said by telephone.
“However, we would be happy to give Mr. Leven a tour of what upstate
New York has to offer. There is a lot to New York state outside
New York City.”

Cuomo has been negotiating with lawmakers over casino
locations since January, when he announced plans to put them in
upstate New York. He’s reached agreements with two casino-operating Indian tribes, the Mohawks near the Canadian border
and the Oneidas in central New York.

The deals grant exclusivity zones of 10 counties for the
Oneidas and eight for the Mohawks if voters in November approve
a constitutional amendment allowing Las Vegas-style casinos in
the third-most populous state. That would eliminate those two
regions from possible casino development, leaving only four
areas for the three casinos Cuomo wants.

Tribal Casinos

One of those four is in western New York, where the state
and the Senecas are feuding over $600 million in tax revenue. If
a deal is struck, that area may also be eliminated from
contention, according to Cuomo’s proposal.

The bill Cuomo released yesterday would be subject to
negotiations with lawmakers, with a potential deal by the end of
the legislative session on June 20. Not every developer shares
Sands’ concerns. Michael Treanor, chief executive officer of
Nevele Investors LLC, which owns the former Nevele Hotel in the
Catskills, applauded the governor’s plan in a statement.
Excluding New York City, as well as the proposed 25 percent tax
rate, make the governor’s proposal attractive, Treanor said in a
statement.

“We are one step closer to bringing real economic recovery
to Ulster County and the Hudson Valley,” he said.

Sands’ executives said they’d be interested in a New York
City casino.

“A lot of what happens in terms of casino locations and
what happens with governments is that they make political
decisions and not necessarily what’s best for the state,” Leven
said.

Sands operates a casino 80 miles west of New York City in
Bethlehem, Pennsylvania. Pennsylvania passed New Jersey to
become the second-largest gambling market in the U.S. after
Nevada, with revenue of $3.16 billion last year.